04-24-2026 
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The European Securities and Markets Authority (ESMA), the European Union’s financial markets regulator and supervisor, issued a statement on April 17 clarifying its expectations ahead of the end of the transitional periods for digital asset firms and national regulators to get themselves compliant with the EU’s Markets in Crypto-Assets (MiCA) regulation.
- ESMA outlines MiCA compliance timeline
- Wind-down plans due by July 1, 2026
- Tightening NCA grip on CASP exits
- Centralizing crypto regulation
“The MiCA transitional period will officially expire across the EU on 1 July 2026,” said ESMA. “After this date, any entity providing crypto-asset services to EU clients without a MiCA license will be in breach of EU law and must cease offering such services.”
The landmark MiCA regulatory framework fully came into force on December 30, 2024, and requires crypto-asset service providers (CASPs) operating in the EU to apply for a license and obtain authorization from the national competent authority (NCA), the country’s relevant regulator, where their operations are based.
Under a transitional regime, CASPs operating in the EU could continue to operate while they apply for MiCA authorization for up to 18 months after the December 30 implementation date or until their MiCA license is granted or refused, whichever is sooner. Meaning, firms that fail to apply for a license by July 1, 2026, or fail in their application, will have to cease operating across the 27-nation bloc immediately.
In its previous statements on supervisory convergence, transitional measures, and the end of transitional periods, ESMA consistently emphasized the importance of timely authorization, orderly transition, and client protection. In December 2025, the EU market watchdog also said that it expects digital asset companies without MiCA authorization to have either implemented “orderly wind-down plans” or have such plans in place by the end of the transition period.
Its latest statement reiterates and emphasizes many of these points for both digital asset firms and national regulators.
Expectations for CASPs
For CASPs, ESMA’s main concerns are ensuring that wind-down and client migration are handled correctly and achieved before the deadline.
“Wind-down plans enable an orderly exit without causing undue economic harm to clients, including by arranging the offboarding of clients – for example by organizing the transfer of crypto-assets held on their behalf to an authorized CASP or to a self hosted wallet,” read the ESMA statement. “CASPs should provide existing clients with prior notice before implementing the wind-down plan.”
The regulator added that “plans should be operational, credible, and immediately executable and designed in accordance with all relevant EU conduct, prudential, and AML/CFT obligations.”
On July 1, 2026, when the transitional period ends across the EU, any unauthorized CASP must have implemented its wind-down plan. On top of this, ESMA said it expects authorized CASPs to actively manage the migration of existing clients ahead of the deadline.
“In particular, authorized CASPs should take the necessary steps to onboard existing EU clients before the end of the transitional period,” ESMA said. “In doing so, ESMA expects authorized CASPs to apply robust onboarding processes to ensure full compliance with applicable AML/CFT requirements.”
For entities established outside the EU, ESMA reminded market participants that, outside the narrow exception of reverse solicitation, they are not permitted to provide crypto asset services that qualify as MiCA services to EU investors or to solicit EU clients.
This prohibition applies in a business-to-business context, as MiCA specifically prohibits CASPs from outsourcing or delegating certain services, namely custody, to entities not authorized as CASPs themselves.
In this regard, ESMA clarified that “CASPs should ensure that all outsourcing and delegation arrangements are fully compliant and do not result in services being provided to EU clients via unauthorized third-country entities.”
Expectations for NCAs
The EU watchdog was also keen to ensure member states’ NCAs were doing their part to prepare for the end of the transitional period.
Specifically, NCAs are expected to verify the existence and adequacy of orderly wind-down plans for unauthorized CASPs, and ensure these are implemented in a timely manner without causing “undue economic harm to clients.”
They must also be prepared to take action against the unauthorized provision of crypto-asset services following the end of the transitional period, in cooperation with other competent authorities where appropriate.Under MiCA, CASPs operating without authorization can face severe penalties, including fines of up to €5 million ($5.8 million) or 5% of annual turnover, cease-and-desist orders, and bans on EU operations. Authorities may also revoke licenses, impose criminal liability, and sanction executives, effectively forcing non-compliant firms out of the EU market.
NCAs must be prepared to impose such punishments, if necessary, by the end of July.
Finally, ESMA reiterated that NCAs must “scrutinize client migration strategies,” ensuring that authorized CASPs take timely steps to onboard EU clients currently or previously serviced by unauthorized CASPs.
ESMA said these various measures need to be in place to ensure “effective and convergent supervision across the Union.” However, the EU watchdog may soon have more direct power to impact this goal.
ESMA to be EU-wide regulator
ESMA appears set to become the principal regulatory authority overseeing MiCA, taking responsibility for enforcing compliance in the digital asset space away from member states’ NCAs.
In an October 2025 interview with the Financial Times, ESMA chair Verena Ross revealed that the European Commission (EC), the executive branch of the EU, was developing plans to bring several sectors, including digital assets, stock exchanges, and clearing houses, under ESMA’s supervision and away from individual state regulators.
On December 4, 2025, it adopted the “Market Integration and Supervision” package, aimed at removing barriers to an integrated capital market that arise from differences in regulatory approaches, as well as aiming to ensure that passporting functions efficiently to facilitate operations across member states. Centralizing EU digital asset supervision under ESMA was a part of this package.
This move received support from lawmakers and regulators of some major EU jurisdictions, such as France, and more recently the European Central Bank (ECB), which also threw its substantial weight behind the proposal. However, it still faces opposition from some member states, including the popular MiCA licensing hub of Malta, which recently suggested it was a politically motivated decision inspired by jealousy over the country’s success in attracting prominent digital asset firms, such as OKX and Crypto.com.
The Market Integration and Supervision package must still be negotiated by member states and face a vote in the European Parliament, but if passed, ESMA could take over responsibility for oversight of the digital asset space as soon as 2027.
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